Considering when you sell all the gold in Fort Knox all at once would pretty much crash gold's value.
How much is the gold in Fort Knox really worth?
How much is the gold in Fort Knox really worth?
Amount of present gold holdings: 147.3 million ounces. The gold is held as an asset of the United States at book value of $42.22 per ounce.
http://www.bloomberg.com/markets/commodities/futures/metals/
COMEX Gold Value: 1,250.40/per troy ounce
1 ounce = 0.911458333 troy ounces
$167,875,968,689 USD
You are correct. Selling that much gold at once would decimate the gold market.
To the true matter though is that valuing things by their liquid value is problematic especially when their liquidity isn't ever really going to be utilized.